Global demand for natural rubber is projected to exceed production for a sixth straight year in 2026, with accelerating growth in the automotive sector across emerging and advanced economies driving consumption, an industry body said.
Global production is forecast to grow by 2.4% to reach 15.2 million tons in 2026, following a modest 1.4% increase in 2025, the Association of Natural Rubber Producing Countries (ANRPC) said in an email response to Reuters.
"Output growth continues to lag expectations despite improved grower prices since 2025, due to adverse weather, limited replanting of ageing trees, persistently low productivity among smallholders after years of depressed prices, and competing land-use changes," it said.
ANRPC added that rubber plantations have also faced an outbreak of major leaf fall diseases that spread across several producing countries and caused significant yield losses that have reached as high as 30%–35% in some areas.
Meanwhile, demand growth in China, Europe, and the US is expected to recover modestly in 2026, it said. This is likely to be driven by rising new vehicle registrations in the EU, stronger tyre shipment projections in the US, the EU–India and US–India trade agreements covering rubber products, and continued government incentives for electric vehicle purchases in China, it added.
"Overall demand in 2026 is projected to grow by 1.7% to reach 15.6 million tons," ANRPC said, adding that demand from the world's largest consumers of natural rubber, China and India, is forecast to grow by 1.7% and 3.6%, respectively.
This is likely to keep global prices firm. Benchmark Tokyo rubber has gained around 3% in 2026 after dropping in 2025. Rubber was one of the biggest gainers in commodities markets in 2024, climbing 46%.
"This imbalance between consumption and production is expected to reinforce upward pressure on prices and sustain the structural tightness of the global natural rubber market," ANRPC said.
Output in Thailand, the world's largest rubber producer, is expected to remain flat in 2026, while Indonesia, the second-largest producer, is set to continue its decline since 2022 due to low prices, leaf diseases, and land conversion to oil palm, ANRPC said.
Ivory Coast is poised to emerge as the world's third-largest producer, overtaking Vietnam, due to its sustained expansion of rubber acreage and high productivity of its smallholdings, the body added.
Source: theedgemalaysia